Maharashtra discom goes slow on green power buy

The country's most industrialized state is discriminating against green energy generation as it prefers to make payments to power plants that burn coal, top renewable energy entrepreneurs said.

"Maharashtra discriminates against renewables. It pays conventional guys better. Right now, it is the first state to be doing that," said Sumant Sinha, president of the ReNew Power Venture.

Going over the annual statements for 2014 of the Maharashtra State Electricity Distribution Company (MSEDCL), there seems to be clear preference for conventional sources of power with over 90% of the power purchased being from conventional sources of energy including thermal, oil, natural gas and nuclear. While all state distribution companies, or discoms, are facing financial difficulties, some of them seem to be worse off than others.

"All states pay everybody pretty much on time but they just don't pay enough (and) some of them are delayed. Most states are paying on time. The only exceptions right now are Rajasthan, Maharashtra, Madhya Pradesh and Tamil Nadu. These are the problem childs," said Sinha.

Madhya Pradesh solar pays on time, but unfortunately, does not pay wind on time. So it sort of differentiates between the two. Rajasthan is, in general, backed up for everything, Tamil Nadu is backed up and Maharashtra is massively backed up."

The total liability of the Maharashtra state discom including transmission charges and power purchase till March 31, 2014, is al . 14,000 crore.most ` Ratul Puri, chairman of Hindustan Powerprojects, trying to rationalize the behavior of the discoms, said, "When you speak of the discom, you are looking at a cost. You need to allocate that out.You allocate that to the cheapest form of energy you are getting because you say otherwise the cheap form of energy will go away? Possibly."

Earlier Maharashtra's aversion to buying up wind power has led to over . `4000 crore worth of wind power assets running the risk of defaulting and becoming non-perfor ming assets.

As per a recent CAG report, the Maharashtra government has done well in implementing its targets for commissioning non-conventional sources of energy under a policy of 2008. However, the same report also notes that solar policy was left out and only formed in 2015 and "due to non-framing of policy by GoM (Govt of Maharashtra), the solar sector had long been ignored and the capaci ty addition in this sector was in significant despite a potential of 64,320 MW assessed by the Ministry of New and R ..

The report also notes that Rs 2,315 crore was collected by way of taxes on sale of electricity which was to be transferred to Maharashtra Energy Development Authority (MEDA) for the development of non-conventional and renewable sources of energy. However, 2007-08 and 2014-15, only Rs 112.79 crore was transferred to them and the balance Rs 2,202.21 crore was neither transferred to MEDA nor utilised for promotion of the RE (renewable energy) sector."

Maharashtra has over 10,000 mega watts in renewable energy potential. While it has managed to increase the number commissioned projects, integration with the grid and power purchase agreements have been procrastinated, especially for the renewable sector.